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Ballmer.jpg
Steve Ballmer joined Microsoft in 1980, and became Microsoft's 30th employee. He was the first business manager Bill Gates hired. Ballmer became CEO of Microsoft in January of 2000. (AP file photo)

Microsoft's biggest problem is Steve Ballmer, says former exec

February 10, 2013 @ 6:10 pm (Updated: 9:57 am - 2/11/13 )

There are the things we know about Microsoft CEO Steve Ballmer from YouTube clips of company meetings and product roll-outs.

"He is a very high-strung individual," says a former company executive, pointing to a raucous company meeting with Ballmer in charge, running around the stage, screaming, "I have four words for you. I love this company."

There are the things people who work at Microsoft know.

"He walks the hallways sometimes bouncing a basketball in front of him," a former co-worker says.

Then there are the things employee number 400 at Microsoft knows about the CEO.

"I always got along fine with Steve, but he is not a visionary and he's not the right person to run the company," says Joachim Kempin, a former company senior VP.

Kempin admits his new book Resolve and Fortitude: Microsoft's Secret Power Broker Breaks His Silence is an attempt to "stir things up."

"I still feel a huge bond with Microsoft. I use their products every day. But, it frustrates me that the company basically has lost so many battles - Google search, Microsoft Bing. The iPod and Zune (Microsoft's discontinued digital media player.) Look at the iPhone, Apple's tablet and you go down the list, the Android operating system, Facebook," says Kempin.

"All of that happened over the last 10, 11, 12 years and you have to question whether there is the right team in Microsoft to conquer the new world."

Kempin ran Microsoft's operation in Germany before coming to the U.S. in 1983 and becoming a powerful figure within the company who oversaw all of Microsoft's product sales to PC manufacturers.

"It was an amazing ride," he says. "When I started that group we did around $170 million a year. Fifteen years later we did $9 billion a year. The team really excelled, and there were years when that group pulled in more than half the profits of Microsoft."

In his 20 years with the company, Kempin saw a change in leadership styles.

The early years reminded him of the kind management "you would find in the German military, basically 'take that hill, and I don't need to tell you how to do it, you figure it out.' Later people would say, take that hill and I will tell you how to do it, which gives less freedom in your action and you feel less empowered."

Wearing a suit and tennis shoes as he described his life now as being an enjoyable one living in West Seattle, but still thinking of Microsoft and wishing the company would "get on track."

Some would argue, Microsoft doesn't need advice from someone who left the company a decade ago. They're doing fine.

For Microsoft's most recent quarter, the company reported revenues on Jan. 24, 2013 totaling $21.5 billion. It posted earnings per share of 76 cents for the December quarter, beating Wall Street's expectations by 1 cent. That quarter included the launch of key Microsoft products Windows 8 and the Surface tablet.

"When you just look at revenue and profit Ballmer is doing a good job," says Kempin. "By every other measure he is taking the company in the wrong direction."

There is plenty of talent within Microsoft, Kempin says, but Ballmer has a way of "purposefully ousting any executives with potential to wrest him from the CEO seat, "which he has occupied since 2000.

Many of Microsoft's top tier managers have left the company during Ballmer's time as CEO.

Richard Belluzzo, credited with launching the Xbox game console, rose to chief operating officer at Microsoft but left after only 14 months in that job. More recently Windows unit Chief Steven Sinofsky left the company last year. Office chief Stephen Elop went to Nokia. Ray Ozzie, the software guru Gates designated as Microsoft's big-picture thinker, left to start his own project.

Microsoft representatives declined comment about Ballmer, and Kempin's book.

Kempin adds he "always got along great with Steve" and he's "surprised" Ballmer hasn't contacted him since the book came out.

Beyond changing the CEO, Kempin would like to see someone else as a visionary for the company and he suggests turning employees free to be more creative.

"The company spends around $10 billion in research and development every year, but the ideas don't make it to the market," says Kempin. "There's plenty of good stuff in that company, give the people some seed money and let them go."

By LINDA THOMAS

More from Linda Thomas

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Comments (17)


  • Add A Comment

  • CH wrote...
    "He walks the hallways sometimes bouncing a basketball in front of him"
    February 11, 2013 5:41 am
    SoDo Arena?
    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • messiah101 wrote...
    Point Guard?
    February 11, 2013 9:21 am
    Seattle Kings?
    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • Ted Bundi wrote...
    Ahh, Mirosoft ala IBM 1985
    February 11, 2013 6:20 am
    ...
    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • vanderleun wrote...
    Least surprising news of the decade
    February 11, 2013 7:31 am
    To look at him is to know that deep down Ballmer's shallow.
    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • Chuck Gould wrote...
    Maybe the visionaries all cashed out
    February 11, 2013 7:46 am
    How many of the rag tag, starry eyed young geniuses who dreamed the original dreams remain? Haven't most of them, including Gates and Allen, stepped aside to devote the rest of their lives to spending and/or giving away their almost immeasurable wealth?

    Steve Ballmer runs Microsoft like a multi-billion dollar business. He probably runs it well, from a fiscal perspective. In a way, that's too bad. Microsoft was one of those lucky, once-in-a-lifetime situations where dreamers and visionaries profoundly changed, or participated in the profound change of, the world. Effective fiscal managers don't bet on dreams. They advise caution, and focus on doubling down on what is already working.

    I looked at the latest Windows the other day. I thought "Windows Ate, (and ate, and ate) until it was too far out of shape to be nimble. I shouldn't have to relearn my software every few years in exchange for only miniscule improvement."

    Apple has been the innovator for the last several years, but with the demise of Steve Jobs we will soon see whether there are many visionaries in that firm.

    Ten years from now, the biggest deal in computer advancement could easily be a company nobody has even heard of yet. We live in accelerating times.

    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • El Duderino wrote...
    Yeah, so...
    February 11, 2013 8:01 am
    MS has been playing catch up since the mid 1990s. Gates and crew completely missed the Internet revolution.

    Don't cry too hard, they are still a giant in operating systems, interoperability, and other business needs. Consumer market is nice but they are still making billions at a very high profit margin.

    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • mnpat wrote...
    "Microsoft's biggest problem is Steve Ballmer, says former exec"
    February 11, 2013 8:06 am
    Well.........I guess that is between those that work there, own stock and Microsoft. Not sure what the story is supposed to be saying to us, personnally, I really don't care what issues they have or don't have, I have plenty on my own plate then to worry about Microsot's plate.
    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • iapproveofthismessage wrote...
    +1
    February 11, 2013 8:39 am
    Generally speaking, the #1 objective of any CEO of a public company is the generation of shareholder value. The top scorecard metric for measuring this is stock price. The adjusted share price from the day (Jan. 2000) Ballmer assumed CEO role is $44/shr. Today's (Feb. 2013) stock price is $28/shr. JK shares many anecdotal observations, which given his insights, are very credible. But at the end of the day, ANY CEO's inability to generate ANY share growth over a span of over a dozen years, and still have survived objective peer review is amazing! Especially given the performance of AAPL, AMZN, ORCL, GOOG, etc. during that same period! The real news here is JK's conviction to share and Linda's to print, neither of which are easy given the combined power of the 2 largest MSFT shareholders. Thanks to you both :)
    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • dadling wrote...
    This is why he's a "Former Exec"
    February 11, 2013 8:56 am
    Sour grapes...this is why this guy is a former exec....everybody is a genius..until they're not !! Bhwwwaaahaha
    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • sokala wrote...
    Another Sloan School of Management case study in a few years
    February 11, 2013 10:44 am
    ....if Microsoft keeps it up...they will go the same way Kodak has....late to the game and use their bankroll to sustain for a while.
    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • monkeyal wrote...
    Bill Gates himself
    February 11, 2013 10:57 am
    predicted many years ago that younger new guys would come along and bring new high tech to the world without being from the MSFT team. As for Steve Ballmer, the shareholders keep voting and the board keeps believing. And, local basketball fans from Lakeside High School to the Seattle Sonics appreciate his enthusiastic support.
    { "Thumbs Up":"1","Thumbs Down":"-1" }
  • { "Thumbs Up":"1","Thumbs Down":"-1" }